FAO: POTENTIAL OF SOLAR ENERGY SYSTEMS IN RURAL AREAS OFTEN STILL UNTAPPED

Rome, 23 October - Selective use of solar energy could significantly improve
the livelihood of millions of people in rural areas in developing countries,
the UN Food and Agriculture Organization (FAO) said in a new report issued
today, entitled Solar Photovoltaics for Sustainable Agriculture and Rural
Development.

Solar photovoltaic technology is currently mainly used for lighting, radio
and television in households, FAO said. But it went on:

"The time is ripe now to advance towards a new phase of solar energy beyond
the light bulb. We should not only use solar systems for household lighting,
but also for pumping drinking water, irrigation, cattle watering, small cottage
and agro-industries, facilitating educational radio and tv programmes and
health services."

Almost two billion people in developing countries are still without access
to electricity. Their energy problems will not be resolved by solar home
electrification alone, FAO said. "It is realized that the most disadvantaged,
subsistence farmers will generally not be able to afford solar systems. Solar
systems do, however, provide some particular advantages that make them
interesting for basic social services such as water supply and vaccine
refrigeration, as well as for several niche-applications. With lower prices,
the size and number of niches will grow," FAO said.

The report cites many examples of growing solar energy application in
agriculture. Solar pumping is suitable for drip irrigation of horticultural
and other high value crops. Solar systems are also often the most economic
solutions to supply water for people and their livestock in remote, unelectrified
areas. Water pumping is one of the major rural photovoltaic markets in developing
countries while solar electric powered fences are also widely sold.

Small solar systems also help develop other productive activities in many
countries, such as restaurants, bars, cinemas, telephone shops, technical
and artisanal workshops by providing light and powering small tools such
as drills, blenders, mobile phones and television sets. Installing and
maintaining solar systems and selling photovoltaic electricity helps to create
jobs in rural areas.

However, the introduction of photovoltaics still faces several barriers such
as high investment costs, lack of financing and infrastructure, low volumes
of sales, lack of political commitment and policies, FAO said. Innovative
financial schemes such as revolving funds, soft loans to farmer cooperatives
and equipment leasing arrangements are opening new opportunities for the
application of solar technologies.

FAO called upon governments to promote solar systems in rural areas. Rural
and agricultural development banks should make such systems eligible for
loans. Women should have equal access to credit. Private sector investments
should be attracted for financing solar energy electrification programmes.
International donor funds could be used as a leverage for such private sector
investments.

Integrated photovoltaic electrification programmes should simultaneously
address electricity needs in different sectors of rural society by offering
solar systems for drinking water, irrigation, health care, education and
communication. The energy, agriculture, education and health sector should
work closer together to ensure that solar systems are used for delivering
these basic needs and services to the rural poor. Such an integrated approach
could also help to promote solar technology, improve maintenance and servicing
infrastructure and create sustainable markets. Moreover, solar energy systems
would also serve the environment and concerns about climate change.